February rate cut prompts uptick in property settlements
Improved buyer sentiment from the Reserve Bank of Australia’s last cash rate cut led to an increase in mortgage refinancing and residential property settlement over the March quarter, according to the latest industry research.
Digital property exchange platform PEXA’s latest Property and Mortgage Insights Report showed that refinancing activity sharply increased over the March 2025 quarter, amid continued growth in property prices and sales volumes.
The report found that refinancing volumes in the March quarter rose by 12.5 per cent compared to levels from one year prior, which PEXA’s chief economist, Julie Toth, linked to the effects of the Reserve Bank’s latest rate cut.
“Growth in refinancing activity has been driven by the recent interest rate cut, which has increased borrowing capacity for prospective buyers and resulted in lenders introducing incentives such as reduced fixed-rate loans and cash incentives for home buyers,” Toth said.
Across Australia’s five mainland states, there were a total of 156,573 settlements valued at $158.5 billion in the last quarter, marking an increase of 1.2 per cent for volume and 5.2 per cent in terms of value compared to the same quarter last year.
In the commercial property sector, the report noted that Victoria and Queensland registered higher settlement volumes year-over-year, while in NSW, the number of commercial settlements declined compared to the previous year.
Despite the NSW market’s annual reduction in settlement volumes, the premier state settled $7.7 billion worth of commercial property over the March quarter, followed by $5.6 billion in Victoria and $4.5 billion in Queensland.
Looking at the amount spent on settlements in March, over $140 billion was allocated for residential property, representing a 6.4 per cent increase from the previous year and marking a significant 56.1 per cent rise from residential property settlements compared to March 2020.
The report observed that demand for property in Queensland, Western Australia, and South Australia remained strong over the March quarter, with the 43,530 settlements recorded in Queensland marking the highest number across the nation.
While Victoria and South Australia recorded the highest year-on-year growth in residential property sales of 4.1 per cent and 4.3 per cent respectively, NSW and Western Australia lagged behind the other states with annual growth of less than 1 per cent in both markets.
Nevertheless, the report observed that the aggregate value spent on property in Queensland, Western Australia, and South Australia all increased 12–15 per cent compared to the same quarter last year.
Toth highlighted that PEXA witnessed continued price growth across the mainland states over the last quarter, but noted that demand for property had increased, particularly in Queensland, Western Australia, and South Australia.
“This cements a trend of buyer interest shifting away from NSW and VIC to the smaller capital cities, and the South-East QLD region in general,” Toth said.
Residential property prices also continued to climb over the March quarter, with the median residential house price in Queensland surging far beyond its counterparts, driven by year-on-year growth of 12.3 per cent in Greater Brisbane and 13.6 per cent in regional Queensland.
While Toth singled out the Gold Coast and Sunshine Coast markets as particularly active over the March quarter, she said that rising prices in these areas are posing an obstacle to first home buyer activity.
“This increased popularity in QLD is also coming at a cost for first home buyers with median house prices increasing and the proportion of properties selling under $800,000 now in sharp decline,” she concluded.